Xcel Energy Inc. · NASDAQ:XEL
Xcel Energy — Q3 2023 Earnings Presentation
31 slides from Xcel Energy's earnings presentation, Oct 27, 2023
Slide 1: 2023 Third Quarter Earnings Report Presentation
2023 THIRD QUARTER EARNINGS REPORT PRESENTATION OCTOBER 27, 2023
Slide 2: Safe Harbor
Safe Harbor Except for the historical statements contained in this presentation, the matters discussed herein are forward-looking statements that are subject to certain risks, uncertainties and assumptions. Such forward-looking statements, including those relating to 2023 and 2024 EPS guidance, long
Slide 3: 2023 Q3 Highlights
2023 Q3 Highlights • 2023 Q3 GAAP EPS of $1.19 • 2023 Q3 Ongoing EPS of $1.23 • Narrowed 2023 Ongoing EPS guidance to $3.32 to $3.37 • Initiated 2024 Ongoing EPS guidance of $3.50 to $3.60, inline with 5-7% long-term growth target • Updated 5-year investment plan (2024 – 2028) of $34 billion, implie
Slide 4: Base Capital Forecast 2024 - 2028
Base Capital Forecast 2024 - 2028 Investment by Function Investment by Company Other Electric SPS Distribution SPS NSPM 10% 12% NSPM 30% 15% 37% Natural 37% Gas LDC 10% ~$34 $22.5 ~$34 Electric Billion Billion Billion Generation Electric 12% Transmission PSCo NSPW NSPW Renewables 34% 42% 10% 9% 4% B
Slide 5: Additional Capital – Steel for Fuel 2.0
Additional Capital – Steel for Fuel 2.0 Additional Capital 2024 – 2028 $ Millions $44,000 $740 $1,640 NSPM 1,200 MW Recommended $7,620 Solar + Storage RFP & Other RFPs $34,000 Preferred Generation Portfolio Base Capital Plan PSCo Resource SPS Resource Plan Future RFPs Additional Capital Plan Plan Es
Slide 6: Additional Capital – Steel for Fuel 2.0
Additional Capital – Steel for Fuel 2.0 Capital Expenditures $ Billions $2.5 $3.3 $2.8 $1.4 $6.7 $7.3 $6.7 $7.1 $6.3 2024 2025 2026 2027 2028 Base Additional • PSCo Preferred Portfolio: ~4,800 MW of owned resources with approval expected early 2024 • SPS proposal: 418 MW owned solar + storage projec
Slide 7: Strong Rate Base Growth
Strong Rate Base Growth Xcel Energy Consolidated Op Co Base CAGRs 2023 - 2028 Base 2023 - 2028 CAGR: ~7.6% $ Billions Additional 2023 - 2028 CAGR: ~10.7% NSPM PSCo ~7% ~9% $9.0 XEL $8.2 ~7.6% $5.7 NSPW SPS $2.7 ~12% ~4% $57.6 $60.6 $50.1 $53.7 $45.8 $41.9 Op Co CAGRs exclude potential additional cap
Slide 8: Colorado Resource Plan – Preferred Plan
Colorado Resource Plan – Preferred Plan 85% Carbon Reduction & Coal Exit by 2030 Full coal exit by 2030 Significant renewable additions • Hayden 1 & 2 (233 MW) retire 2028/2027 • ~3,406 MW wind • Pawnee (505 MW) conversion to natural • ~1,969 MW universal scale solar gas no later than January 2026 •
Slide 9: Generation RFPs Outstanding
Generation RFPs Outstanding RFP Scope* Key Dates • PSCo filed recommended portfolio September 2023 − 7,192 MW of total resources PSCo • IRP needs through 2028 − 4,787 MW owned (67%) • CPUC decision early 2024 • PSCo will file additional RFPs for remaining requirements • In September 2023, MPUC appro
Slide 10: Recent DOE Grants
Recent DOE Grants • Subject to final negotiation, $925 million awarded to Xcel Energy (~50% total Heartland Hydrogen Hub capital) and partners (HH2H) • Xcel Energy would use renewables and nuclear energy to produce and blend hydrogen into power, natural gas and industrial applications • Awarded $70
Slide 11: EPS Results by Operating Company
EPS Results by Operating Company Third Quarter YTD Operating Company 2023 2022 2023 2022 PSCo $ 0.41 $ 0.45 $ 0.97 $ 1.02 NSPM 0.47 0.49 0.95 0.94 SPS 0.30 0.25 0.55 0.52 NSPW 0.06 0.07 0.18 0.19 Earnings from equity method investments 0.01 0.01 0.03 0.02 Regulated utility 1.25 1.28 2.68 2.69 Holdin
Slide 12: Quarterly EPS Change
Quarterly EPS Change * Changes primarily offset by lower electric revenues and are earnings neutral ** Other includes other income and net changes Amounts may not sum due to rounding 11
Slide 13: YTD EPS Change
YTD EPS Change * Combined electric and natural gas margins include ~$0.04 of negative weather impacts (post regulatory mechanisms) ** Changes primarily offset by lower electric revenues and are earnings neutral *** Other includes other income and net changes 12
Slide 14: Sales and Customer Data
Sales and Customer Data 2023 YTD W/A Retail Electric Sales Growth 2023 Q3 YoY Electric Customer Growth 4.7% 1.2% 0.7% 1.1% 1.1% 0.5% 0.3% 1.1% -0.4% -0.3% NSPM NSPW PSCo SPS Xcel Energy NSPM NSPW PSCo SPS Xcel Energy 2023 YTD W/A Natural Gas Sales Growth 2023 Q3 YoY Natural Gas Customer Growth 1.1%
Slide 15: PSCo Colorado Electric Rate Case – Final
PSCo Colorado Electric Rate Case – Final • In November 2022, PSCo filed an electric rate case requesting: − Revised net base rate increase of ~$253 million − ROE of 10.25% and equity ratio of 55.7% − 2023 forward test year − Rate base of $11.3 billion • In August 2023, Commission approved settlement
Slide 16: SPS New Mexico Electric Rate Case – Final
SPS New Mexico Electric Rate Case – Final • In November 2022, SPS filed an electric rate case requesting: − Revised rate increase of ~$75 million − ROE of 10.75% and equity ratio of 54.7% − Rate base of ~$2.4 billion − Acceleration of Tolk coal plant depreciation life from 2032 to 2028 − Forward tes
Slide 17: SPS Texas Electric Rate Case – Pending
SPS Texas Electric Rate Case – Pending Proceeding No. 54634 • In February 2023, SPS filed an electric rate case requesting: − Revised rate increase of ~$136 million, reflecting ~$19 million recovered through riders − ROE of 10.65% and equity ratio of 54.6% − Rate base of ~$3.6 billion − Acceleration
Slide 18: NSPW Wisconsin Electric & Natural Gas Rate Case – Pending
NSPW Wisconsin Electric & Natural Gas Rate Case – Pending Proceeding No. 4220-UR-126 • In April 2023, NSPW filed an electric and natural gas rate case requesting: − Revised base electric rate increase of ~$25 million − Revised base natural gas rate increase of ~$7 million − ROE of 10.25% and equity
Slide 19: 2023 Ongoing EPS Guidance: Narrowed to $3.32 - $3.37
2023 Ongoing EPS Guidance: Narrowed to $3.32 - $3.37 Earnings Drivers Key Assumptions (as compared to 2022 levels unless noted) Regulatory proceedings Constructive outcomes in all pending proceedings Weather Normal weather patterns for the remainder of the year W/A retail electric sales Increase of
Slide 20: 2024 Ongoing EPS Guidance: $3.50 - $3.60
2024 Ongoing EPS Guidance: $3.50 - $3.60 Earnings Drivers Key Assumptions (as compared to 2023 levels unless noted) Regulatory proceedings Constructive outcomes in all pending proceedings Weather Normal weather patterns for the year W/A retail electric sales Increase of ~2 - 3% W/A retail firm natur
Slide 21: Appendix
APPENDIX 20
Slide 22: ROE Results – Ongoing Earnings
ROE Results – Ongoing Earnings Ongoing ROE 2022 Rate Base Twelve Months Ended 9/30/2023 SPS 10.48% 17% 9.57% 9.43% NSPM 8.69% 7.99% 8.58% ~$39 38% PSCo Billion 40% NSPM NSPW PSCo SPS Total Xcel NSPW OpCo Energy 5% Ongoing ROEs exclude impact of Comanche Unit 3 litigation 21
Slide 23: Base Capital Expenditures by Function
Base Capital Expenditures by Function $ Millions 2024 2025 2026 2027 2028 Total Electric Transmission $1,880 $2,150 $2,500 $2,840 $2,080 $11,450 Electric Distribution $1,720 $1,840 $2,030 $2,200 $2,410 $10,200 Electric Generation $930 $1,160 $780 $740 $600 $4,210 Other $760 $720 $670 $630 $630 $3,41
Slide 24: Base Capital Expenditures by Company
Base Capital Expenditures by Company $ Millions 2024 2025 2026 2027 2028 Total NSPM $2,660 $2,970 $2,380 $2,500 $2,180 $12,690 NSPW $570 $600 $570 $600 $650 $2,990 PSCo $2,580 $2,940 $3,030 $3,070 $2,640 $14,260 SPS $910 $780 $660 $870 $830 $4,050 Other* ($20) $0 $10 $10 $10 $10 Total $6,700 $7,290
Slide 25: Financing Plan 2024 - 2028
Financing Plan 2024 - 2028* $ Millions $2,000 $500 $10,980 $3,780 $3,780 $34,000 $20,520 CFO** Maturing Refinanced Incremental Equity Equity Base Plan LT Debt LT Debt Debt (Other) (DRIP) * Financing plans reflect tax credit transferability and are subject to change ** Cash from operations is net of
Slide 26: Strong Credit Metrics
Strong Credit Metrics Plan 2024 2025 2026 2027 2028 FFO/Debt 18% 17% 17% 17% 17% Debt/EBITDA 5.1x 5.1x 5.1x 5.1x 5.1x Equity Ratio 40% 40% 40% 40% 40% Hold Co Debt/Total Debt 24% 24% 24% 24% 24% Credit Ratings Moody’s S&P Fitch Xcel Energy Unsecured Baa1 BBB+ BBB+ NSPM Secured Aa3 A+ A+ NSPW Secured
Slide 27: 2024 Debt Financing Plan
2024 Debt Financing Plan $ Millions Issuer Security Amount Hold Co Unsecured Bonds $750 NSPM First Mortgage Bonds $700 NSPW First Mortgage Bonds $350 PSCo First Mortgage Bonds $900 SPS First Mortgage Bonds $550 Financing plans are subject to change, depending on capital expenditures, regulatory outc
Slide 28: 2023 YTD W/A Electric Sales Growth
2023 YTD W/A Electric Sales Growth NSPM NSPW PSCo SPS Residential C&I Total Retail 5.7% 4.7% 0.6% 1.4% 0.3% 0.9% -0.9% -0.4% -0.5% -0.2% -0.3% -0.2% Extreme weather variations, windchill and cloud cover may not be reflected in estimates 27
Slide 29: Xcel Energy W/A Sales Growth
Xcel Energy W/A Sales Growth Residential C&I Total Retail Electric Natural Gas Electric Natural Gas 3.2% 2.1% 1.7% 1.8% 1.1% 0.8% 0.8% 1.2% 0.4% 0.1% 0.4% -1.3% 2023 2023 2023 2023 2021* 2022 YTD 2021* 2022 YTD 2021* 2022 YTD 2021* 2022 YTD * Leap year adjusted Extreme weather variations, windchill
Slide 30: 2023 Q4 Events
2023 Q4 Events Events Dates EEI Financial Conference November 12-14 Mizuho Conference December 5 Wells Fargo Conference December 6 29
Slide 31: © 2023 Xcel Energy Inc.
(2) Xcel Energy’ © 2023 Xcel Energy Inc.